The Role of Transfer on Death Deeds in Estate Planning

A Transfer on Death (TOD) Deed is a simple and powerful estate planning tool that allows real estate to pass directly to a named beneficiary outside of probate.

How TOD Deeds Work:

Under Indiana Code § 32-17-14, an individual can record a TOD deed that names a beneficiary to receive the property upon the owner’s death. The deed remains revocable during life and has no effect until death.

Benefits:

– Avoids Probate: Title transfers automatically without court involvement.
– Retains Control: The owner can sell or mortgage the property at any time.
– Cost-Effective: Compared to probate administration, a TOD deed saves significant time and expense.

Limitations:

– A TOD deed must be recorded during the owner’s lifetime.
– It does not transfer ownership until death, so the beneficiary has no current rights.
– Joint owners must agree on beneficiary designations or make separate TOD deeds. TOD deeds are particularly helpful for clients with a primary residence who wish to avoid probate but do not need a full trust.